, two of the world’s biggest fund managers. Wall Street is back, and it’s booming. Pipelines, as bankers like to call their predictions for future work, are bulging with mergers and acquisitions, stock offerings, debt sales, leveraged buyouts and more. As the chief executive of one firm put it: “If you are not making money in this market you should not be in this business.”
Start with psychology, or what Keynes called “animal spirits.” For much of 2020, executives and boards of directors were necessarily inward focused. Many industries – retail, airlines, live entertainment, lodging and hospitality, among them – stared at the abyss. They had to hunker down and raise capital, a chunk of it from government sources, to keep the lights on and avoid large-scale layoffs.
A good chunk sits in special purpose acquisition companies. So-called de-SPAC deals – where that money is used to acquire a company or assets – have shaken up the corporate finance landscape and there’s a lot more to come. SPAC Research counts 419 blank-check companies with $128 billion to spend, plus another 298 poised to raise $72 billion through initial stock offerings.
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